According to industry officials, student loans outstanding for current and former college attendees now exceeds $1.2 trillion. This is obviously a massive number, but what does it mean in reality? First, students graduating now have average debt loads approaching $30,000. Some, much more. It’s not unusual for us to see recent grads with $50,000 or even higher! Second, recent rulings from the largest purchasers of mortgages in the US, FannieMae and FreddieMac, have established a 1% payment calculation on student loans regardless of the actual negotiated payment. So, $50,000 in student debt = $500.00 monthly payment. Third, once loans come into the repayment cycle 6 months post-graduation many people are renegotiating for very small or even no payments citing extreme hardship. The interest clock keeps ticking however, adding to the balance every month!
Consumers’ has taken a common-sense approach, looking to employment history and prospects for increasing income and the ability to service the debt over an extended period of up to 20 years. These terms are available through the loan servicing company by refinancing the numerous loans into one single obligation. This lower payment can result in the ability to qualify for one of Consumers’ portfolio options like our 3% Solution. In many cases, a low-down payment offering with a fixed interest rate means you can buy for less than what you are paying in rent!